DEEP v. MANUFACTURERS LIFE INS. CO.

October 23, 1996

ANTHONY MICHAEL DEEP AND WILLIAM D. DEEP, as Trustees under a Trust for DR. ANTHONY A. DEEP and CAREME SATEL DEEP, on behalf of themselves and all others similarly situated, Plaintiffs,
v.
THE MANUFACTURERS LIFE INSURANCE COMPANY (d/b/a MANULIFE FINANCIAL), THE MANUFACTUERS LIFE INSURANCE COMPANY OF AMERICA, and THE MANUFACTURERS LIFE INSURANCE COMPANY (U.S.A.), Defendants.

Plaintiffs move, pursuant to 28 U.S.C. § 1447(c), to remand this matter to the Superior Court of New Jersey, Law Division: Bergen County. Because the Court concludes that it has jurisdiction over the claims in this case, it denies Plaintiffs' motion to remand.

I. BACKGROUND

Plaintiffs originally filed this action in the Superior Court of New Jersey alleging various state law claims against the Defendants (hereafter "Manulife") in relation to the sale of life insurance to the plaintiff class. More specifically, the Plaintiffs allege that Manulife fraudulently and misleadingly asserted that premiums on certain policies would be required only for a fixed number of years at which point they would be eliminated. (Complaint P 1). These policies became known as "vanishing" premium policies. According to the Complaint, the plaintiff class was, in fact, required to pay substantial amounts of additional premiums beyond the "vanishing date" in order to receive the benefits under the policies for which they had bargained. (Complaint P 3).

On or about March 8, 1990, Dr. Anthony Deep and Careme Satel Deep (the "Deeps") purchased a Manulife policy (the "Policy"), which was placed in trust for their benefit. (Complaint P 6). The $ 17,730 annual premium on the Policy was to be paid for 10 years, at which point, according to the Complaint, premium payments would no longer be due.
*fn1"

In or about March, 1994, Manulife allegedly notified the Deeps and the plaintiff class that they would be required to make premium payments for a substantial number of additional years. (Complaint P 17).

Plaintiffs' Complaint seeks compensatory and punitive damages, attorneys' fees and costs, and the imposition of a constructive trust upon the premiums paid under the so-called "vanishing premium" policies.

The Deeps informed the MDL Panel, by letter dated July 12, 1996, that they intended to file a motion to remand the case to the New Jersey Superior Court. (Id. Ex. B).

After reviewing the correspondence, the MDL Panel, on July 26, 1996, issued a conditional transfer order that would transfer the case to the Southern District of California. The Deeps objected to the conditional transfer order and moved to vacate pursuant to MDL Rule 12(d). They argued, as they do on this motion, that federal jurisdiction is lacking over the claims of the plaintiff class for failure to satisfy the amount in controversy requirement of 28 U.S.C. § 1332. The MDL Panel has not yet ruled on the Deeps' motion to vacate.

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